Gov. Phil Bryant on Thursday ordered another $51 million in cuts from Mississippi’s $6.4 billion budget, as state revenues continue to lag.
“It has become clear that revenue is not adequate to support budgeted expenses for the current fiscal year,” the Republican wrote in a letter to Department of Finance and Administration Executive Director Laura Jackson, ordering the cuts.
In September, Bryant sliced $57 million to make up for an accounting error during legislative budget writing.
Funding for most programs will be cut just under 1.5 percent, pushing cuts for the year above 3 percent. Some programs are exempt, including Mississippi’s K-12 school funding formula, courts and prosecutors, parts of the Department of Public Safety and college financial aid.
Bryant is also transferring $4 million from Mississippi’s $313 million rainy day fund, for a total budget change of $55 million.
Bryant wrote in his letter to Jackson that he hopes Thursday’s action “will be enough to get state government through the current fiscal year, however, additional cuts of transfers from our rainy day fund may be required later.”
The governor can take another $46 million from the rainy day fund without legislative action, meaning he might be able to cushion further budget cuts. Late-year budget cuts are harder for agencies to absorb because they have less time to spread them out.
Last year, Bryant had to call a special session to seek additional authority to withdraw rainy day funds after cutting the budget twice.
Mississippi’s economy has lagged since the end of the recession, shrinking overall since 2008. State revenues recovered better but have been flat in recent years. Total revenue through the end of December is $44 million more than during the same six months of 2015, but $2 million below estimates. Recurring revenues — taxes, fines and fees — are running more than $50 million below last year, and nearly $100 million below projections.
Revenue weakness likely means smaller budgets next year. Lawmakers recommend cutting 3 percent , or $195 million, although some of that could be made up with one-time revenue including lawsuit settlements. Bryant recommends spending $29 million less in the year starting July 1.
Democrats blame the downturn on hundreds of millions of dollars in tax cuts enacted by Republicans since 2012. Republicans blame a weak economy, but many seek to shrink the size of government.
The additional cuts come as agencies seek another $101 million through June 30 to make up for deficits. The state Medicaid agency already seeks $75 million to complete this year. Medicaid lost the most money of any agency Thursday, another $13.8 million. The agency has little control over how much it spends because most revenue pays medical bills. Senate Appropriations Committee Chairman Buck Clarke, R-Hollandale, said the additional cuts will only push up the Medicaid deficit.
Public universities will lose $10.3 million. Higher Education Commissioner Glenn Boyce said schools have been planning for budget cuts, but said they make it “more challenging” for universities. Budget cuts to universities and community colleges — which are losing $3.8 million — often create pressure to raise tuition. Community College Board spokesman Kell Smith said it’s too soon to know how the state’s 15 community colleges will act on tuition.
The state prison system loses $4.7 million. Corrections Commissioner Marshall Fisher will focus on public safety but has “some difficult decisions ahead.”
“No options are off the table,” he said in a statement. “We are considering closing facilities including, regional jails and more community work centers.”
Parts of the Department of Education outside the K-12 funding formula will lose $3.5 million, as will the Department of Mental Health.
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